Fidelity Bank, the leading bank in Nigeria, is making strategic moves to expand its footprint across Africa. The bank has announced its plan to acquire more banks in the region after finalizing the purchase of the London unit of Union Bank of Nigeria Plc.
Fidelity Bank’s CEO, Nneka Onyeali-Ikpe, revealed in a recent interview that the bank is already in talks with another financial institution in Africa, and the acquisition is expected to be completed this year. The bank plans to expand to at least five African countries in addition to Nigeria, with a target of being in six countries by 2024.
The bank is seeking to diversify its earnings and mitigate risks by expanding its operations outside Nigeria. Fidelity Bank is one of Nigeria’s largest banks, with 4 trillion naira in assets, and is the country’s best-performing bank this year, with shares rising by 32%.
The move is a response to the growing trade within the continent, which is expected to increase by 52% in the next decade, according to the African Trade Policy Centre. Fidelity Bank aims to tap into this growth by facilitating trade and corresponding banking roles in these countries.
The Nigerian lender is interested in countries within west, east, and southern Africa, and has already identified a few targets. The bank plans to use the 13.8 billion naira it raised in a private placement earlier this year for the acquisitions.
Fidelity Bank is not alone in its expansion plans. Other Nigerian banks, such as Access Bank Plc, are also looking to expand overseas to manage risks and diversify their earnings. Access Bank Plc aims to expand to 26 countries by 2026 from 16.
Fidelity Bank’s acquisition strategy is expected to position the bank as one of the leading banks in Africa, both in terms of earnings and assets. With the slow economic recovery in Nigeria, currency devaluations, and acute dollar shortages, the bank is looking to expand outside the country to curb its risks and widen its opportunities.
Fidelity Bank is optimistic about the growth prospects of its expansion strategy, as its private banking customers are interested in doing business and acquiring properties in the UK and its environs, and require the bank’s support. The bank expects to generate significant growth from these business opportunities, both for itself and its customers.